As downside risk exists, the EUR/JPY is approaching a multi-week low.
Cross is currently trading between 131.30 and 132.50.
The overbought zone on the momentum oscillator signals aggressive directional bets.
In Asian trading hours on Wednesday morning, the EUR/JPY remained unchanged. With a negative bias, the cross trades in a very narrow trading range.
The EUR/JPY is currently trading at 131.51, up 0.02 percent on the day.
On the daily chart, the EUR/JPY currency pair failed to hold the 132.50 level and plummeted below the 61.8 percent Fibonacci retracement level, which stretches from the low of 129.59.
If the price remains below the session’s low, it may retest the previous day’s low of 131.38.
With bearish momentum, the Moving Average Convergence (MACD) indicator maintains an overbought trajectory. EUR/JPY bears will target the 131.00 horizontal support level if the MACD moves lower.
A daily closing below 131.00, a crucial psychological threshold, would signal a return to the levels observed in April. The pair would then test the horizontal support level of 130.50.
Alternatively, if price rises, it may aim for the 50.0 percent Fibonacci retracement level at 132.00 first. The next objective for the cross would be the high on June 28 at 132.35.
EUR bulls could target the June 17 high of 132.87 with a sustained advance above the indicated level.
Continue reading
